- cross-posted to:
- news@lemmy.world
- cross-posted to:
- news@lemmy.world
You know the Bank of Mum and Dad when you see it: it’s your friend who seems broke, but always has a safety net, or who suddenly (but discreetly) acquires the deposit for a home. It’s those who stayed with their parents while they saved for a flat, or stuck it out in a profession they were passionate about even though the wages are chronically low. It’s those who do not need to consider the financial costs of having children. It’s those whose grandparents are covering nursery or university fees, with the Bank of Grandma and Grandad already driving an economic wedge between different cohorts in generations Alpha (born between 2010 and 2024) and Z (born in the late 1990s and early 2000s).
This is the picture we know, but the Bank of Mum and Dad is not just a luxury confined to the 1% – it is also evident in families like mine. I grew up in a working-class household and was the first person in my family to get a degree, but it was the fact my parents had scrimped in the 1980s to purchase properties in London (and allowed me to crash in one throughout my 20s) that has arguably been the true source of opportunities in my life.
In recent years, we have rightly widened the conversation about privilege in society. And yet how honest are we about one of the most obvious forces shaping anyone under 45: the presence or absence of a parental safety net? The truth is that we live in an inheritocracy. If you’ve grown up in the 21st century, your opportunities are increasingly determined by your access to the Bank of Mum and Dad, rather than by what you earn or learn. The economic roots of this story go back to the 1980s, but it accelerated after the 2008 financial crisis, as private wealth soared and wage growth stalled. In the 2020s, rather than a meritocracy – where hard work pays off – we have evolved into an inheritocracy, based on family wealth.
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We have never lived in a meritocracy. That is just some bullshit billionaires will tell you while you work yourself into an early grave.
And here’s some free life advice: If you can stand to be around your parents once you reach early adulthood, continue to live with them. Life is cheaper in groups. Pay some rent and your share, but you’ll find it a lot easier to save money for your own place when some leech landlord isn’t funnelling all your hard earned money off to their own retirement fund.
Well, wages are shit and prices are unjustifiably high. So yeah, you fall to the safety net or the ground.
Gonna be honest, income inequality is awful in America, but this post feels more like sour grapes.
I’m in this picture, and I do not like it. Well, okay, it’s better than not being in this picture. When I die I’m going to give as much as possible to charity, for what it’s worth.
This is the picture we know, but the Bank of Mum and Dad is not just a luxury confined to the 1% – it is also evident in families like mine. I grew up in a working-class household and was the first person in my family to get a degree, but it was the fact my parents had scrimped in the 1980s to purchase properties in London (and allowed me to crash in one throughout my 20s) that has arguably been the true source of opportunities in my life.
Hate to break it to the author, but that sounds like somebody who started in the (upper?) middle class, and now is in the 5% at least. That’s properties plural, in London. C’mon, everyone with money points to someone they know that’s the next digit up so they can be just average. I find that tacky.
The only friends I have, including myself, that own their home are those with dead parents.
Own as in with a mortgage or own outright? Different things…
I know of other situations. Sometimes they give well still alive to avoid the taxes, haha.
My parents blew up any inheritance I would’ve ended up with due to bad decisions and shit luck.
Now my mom depends on me during her final years as we cruise the stars in a two-bedroom apartment.
A lot of my friends live together and share rent. Some with their parents, and a minority got hitched and live with a spouse. It seems like a lot of people depend on small family groups these days.
Multigenerational homes, or living with a bunch of people, was the norm until less than a hundred years ago. It was only a brief period of time of immense economic and technological growth that we saw people living independently in large numbers. We’re just watching a regression back to the mean. And I don’t know how we avoid it with a growing population, and not everyone wanting or willing to live in a city.
Thing is, if I want to run around naked the whole day I want to be able to do that. If I come home absolutely shitfaced at 8am I don’t want my parents to comment on that. If I want to have loud sex I want to be able to do that. It used to be normal but it absolutely sucks to have no privacy and I don’t want to go back to that as a grown up.
Maybe other than getting shit-faced and coming home at 8am, everything you describe has been something humans have been dealing with forever. We can make it work again.
I also totally agree with you, I don’t want to go back. . . I just understand that I have to pay for that privilege. lol
Honestly, if you’re family is okay, not living with them because you don’t want to seem lame was always a dumb use of resources. That might be one of the stupidest things white people ever invented, and we did savoury salads embedded in jello.
Those tiny, single-person tubes in Japan where one just pays rent for a tube to sleep in and a storage unit would do me fine.
I’d sleep in a hollow log if it meant not sleeping there with another person.
And this is why it’s good to have a ton of different options - and preferably a society that accepts them all.
If you want to tackle this you have to take on inequality. Now we all know if corporates weren’t allowed to pillage profits for themselves, and had a salary tied to their lowest employee, this would go a long way to improving inequality and that alone could offer a lot of people a lot of opportunities. But as long as you have a system where people have to collect arbitrary numbers to acquire necessities there is going to be inequality.
I was able to migrate over to work and study because my family paid for the trip and even though the deal was that I were to work and be by myself I could always call to ask for emergency money. I did that twice, one for paying for my college inscription and other for rent. Without that I wouldn’t had the comfortable life I have today.
“Abolish inheritance”
But what about my inheritance
*sigh*
Inheritance isn’t the root problem. The problem is that the only people with any money are people who were able to save it decades ago. And that problem is because labor has been devalued, wages stagnated, and cost of living soared.
And all of that is because for the past 40 years or so, there has been more benefit to taking profits out of business than spending money within the business.
When you reach the top-tier income tax bracket, and the IRS starts taking 91% of your income beyond that level, $10,000 of business income is only worth $900 to you.
When your best employee wants a $10,000 raise, that money comes straight out of your “excess” earnings. It is $10,000 of your earnings that are not subject to taxation. Paying that $10,000 raise only costs you $900 once you reach that tax bracket.
But we don’t have a 91% top-tier income tax bracket anymore. We had a punitively high top tier rate for most of the 20th century, but it got cut down in the 70’s and slashed in the early 80’s. Now, the top tier income tax bracket is just 37%. When you reach that bracket, giving your best employee a $10,000 raise takes $6700 out of your pocket, instead of just $900.
Reagan’s views on the Laffer curve were correct: raising the tax rate beyond a certain point will actually reduce tax revenue. But tax revenue is not why we need the high rates. The benefit of high marginal tax rates comes from what business does to avoid them. We need to restore the business incentives that come with a punitively high top-tier income tax rate. We need businesses to increase their labor expenses to avoid that tier. Businesses should benefit the whole economy, not just the ownership class.
For similar reasons, we need taxes on registered securities, payable in shares of those securities. The shares collected as taxes will be liquidated in small lots over time, comprising no more than 1% of total traded volume, to limit their effect on the market. Exempt the first $10 million held by a natural person; tax everything above.
I mean, it’s not that clear-cut. There’s still people who have a nice job and save a lot of money, it’s just somewhat less than there used to be, and at the same time the gap with non-nice jobs is larger. Furthermore, $900 is still $900, I question if some random shareholder really cares about a stranger’s raise that much.
More redistribution would help the inequality problem, for obvious reasons, though. I also don’t buy that nobody will do anything without a small chance of becoming a billionaire, or that billionaires are really hundreds of thousands of times smarter than the average person and we need them to be happy.
They could be smart about it. No taxation on inheritance under 2 million (I’m pulling these #s from the sky). Anything over gets taxed progressively; if if these billionaires won’t pay up during life we can grab it on the way out.
That’s already a thing. The estate tax only kicks in over 5mil. It’s typically dodged by putting all assets in trusts so that ownership never legally transfers it’s the trust that owns them. Trusts being a legal vehicle don’t die, and can have beneficiaries added and removed.
So tax trusts…
That only accounts for a small portion of parental contribution and is easily avoidable by an early inheritance.
Nobody bats an eye when you say, “early inheritance,” but everyone gets sooo upset when I murder my parents
People should always have access to essentials, and I count an affordable reliable roof over their head as one of those things. But are we ever going to be able to change the fact that someone on the receiving end of three generations of doing moderately well in life is going to be massively more advantaged that someone whose parents were 4th and 5th in large poor families?
Someone’s parents having even a modest home with a spare room in London puts them at a massive advantage over their peers who have to privately rent. But aside from ensuring the fundamentals are in place of affordable accessible homes, is there really any realistic way of nullifying that advantage and is it even right to do so?
aside from ensuring the fundamentals are in place of affordable accessible homes, is there really any realistic way of nullifying that advantage and is it even right to do so?
I don’t think that’s an aside, I think that’s the key to solving a lot of problems with our current society. Give everyone a roof and enough nutritious food, and most people can figure out how to live their lives from there. The problem is that the lack of housing and food options forces people into low paying jobs with no upward mobility, and continues the cycle of poverty.
I didn’t write that as “an aside”, I wrote “aside from”. You need to read it as “besides”. In the sense of “obviously this needs to be done fundamentally and as a priority, but besides that… etc”.
Why shouldn’t everyone have access to housing, food, education, tutoring, and transportation like those people who inherit from their parents?
The social impact of engaged parents can’t be missed, but there’s no reason why there should be a material aspect.
Because, fundamentally, most people work because it makes their life better than if they weren’t working.
It we so heavily correct the system so that you get the same house whether your working or not, your kid goes to the same school whether your working or not, they get the same homework tutors whether your working or not, you have access to the same transport or car whether you work or not… you get the point.
How many people would even turn up to work if it made no material difference to their life?
But as soon as you allow people’s effort and choice to create an actual difference in the quality of their and their kids lives then you inevitably end up with inequality, because people make different choices, are motivated to work hard to different degrees. This gets compounded when some families simply build on the moderate success of the parents.
Rather, isn’t the better option to just make sure that the “bottom” option is not inhumane and is actually basically alright. In fact, it should be as good as we can possibly make it. BUT then you have to allow that choice, hard work, sacrifice can possibly make a difference and people can improve their lot.
None of that is relevant to the idea of affordable housing for college students because 18 year olds going to college haven’t had the chance to start working yet.
I don’t think I was particularly lazy as a student just because I got free college and $1k a month student loans from the Swedish welfare state, and a free apartment from my parents, all without working a single hour for pay.
I remember some of my strongest drivers in college were my social life, the opportunity to enter an exchange program, passing 75% of my classes to keep my student loans, and my personal interest in the things I studied. So some monetary/quasi-monetary, but also many social. And none of them based on wage labor.
Also, while social democracy like what I’ve described doesn’t reject your ideology, there are also people who work for other reasons besides money, and there are more forms of unpaid work than there are for paid work.
Also, while social democracy like what I’ve described doesn’t reject your ideology
But social democracy is exactly what I’m describing
So we are both describing social democracy
Coming at the same thing from opposite sides as it were. The political movements I linked to have enjoyed at times broad support in Germany and the UK and elsewhere in Europe. They consciously reject ‘hard’ socialism as (regrettably) unworkable. They deliberately seek well functioning safety nets for the vulnerable and less able but see a well regulated 'fair" capitalism as being essential to unlocking people’s creativity and initiative. And that means allowing people to better themselves through their efforts. Equal opportunity not equal outcomes (but safety nets to prevent excess).
Counterpoint: there are so many things a person could be doing that are far far more valuable to society than bullshit “profitable” work, and those things don’t pay, or pay very poorly. You think being required to earn basic existence in life is better, even though the vast majority of jobs are entirely pointless and/or could easily be automated? Such a shameful waste of human potential.
If people had all the time in the world to do what they wanted, most people would still work at least part time, but it probably wouldn’t be for shitty megacorps that treat employees like trash (and those companies deserve to die). Some people would choose to only do community improvement stuff, though, like beautification, guerrilla gardening, or helping to build/remodel community spaces. And that’s actually awesome. We need way way more of that, and less of developers/companies coming in and doing whatever they can to extract money from the community.
They do it now, when they have time or it’s directly beneficial to them, but volunteering is an inherently privileged activity. Poor people don’t have time or energy because they have other shit to do to be able to afford to survive.
How many people would even turn up to work if it made no material difference to their life?
That sounds just like Reagan and his so-called “welfare queen”.
I know everyone is reading this in their own political context, so I realise it’s open to a lot of misinterpretation. But just try and take the idea on its own, in its essence.
If you really had the free choice in the morning to bake artisan bread or go and wade in sewage and clean a communal sewer, do you not think people would need a little bit of motivation into the maintaince job using something more than kind words?
Once you start using capital (money) to indicate need in society (because human preference is not automatically aligned with human needs) then you end up with a situation where some people can choose to accrue capital if they hold their nose and do the shitty jobs no-one else wants to.
Are you telling me that if the extra the sewer cleaner earned was taken away and given to the bakers kids so that things are “nice and equal”, that you’re going to find enough people to clean the sewers in the future?
C’mon. I want the world to be fairer too. I think capitalism’s excesses are gross. But people have to feel they can personally gain else the way to indicate what really needs doing is completely broken.
But people have to feel they can personally gain else the way to indicate what really needs doing is completely broken.
Personal gain over what’s best for everyone is the reason we’re in this shit show.
It’s time to remember that no man is an island, and we need each other’s ideas and commitment in order to fix the mess caused by unfettered capitalism.
Personal gain (or rather personal security) is how humans work. And personal gain is fine when it’s mutual and not exploitative. That’s what good trade is. The answer to unfettered capitalism isn’t no capitalism, it’s fettered capitalism. Or rather social capitalism (also modernised social democracy)
Not because it’s pure, but because it’s realistic, and works. On the other hand expecting people en masse to suddenly discover they all want to personally sacrifice for the same vision of the greater good without enormous amounts of control and coercion is complete fantasy.
Such a rubbish stance. People want to be usefull. So if the basics are met companies will need to make sure they are not exploitative shitholes like they are now.
Absolutely there is a risk, but this risk is created not by inherent lazyness of people but the shitty/dangerous/ unfulfilling/soul crushing jobs, shitty middle management, asshole atmosphere and the hustle required. You have the effect right but the cause wrong.
This would in practice mean that shitty jobs need to pay a hell of a lot more… which is good. Then the MBAs can figure out if making the job less of a hellish place can cause them to pay less and where break-even is.
Bear in mind the person I was replying to was advocating equal outcomes. I was questioning the practically of seeing it that way.
The idea that the economy would still remotely function if you make people’s material outcome absolutely the same irrespective of what they’ve worked on is insane.
So in some ideal world people just all do whatever they feel inwardly motivated to do? How in that world do you signal that maybe the village doesn’t need another artisan baker, what it could really do with is someone to fix the sewers all day.
How do you do that other than compensate the sewer worker more for a job?
“Pay them a higher (fair) wage?”. Well, ok. But that means they’re paid more than the bakers are. And now you’ve sowed the seeds for inequality and we’ve barely started.
While 2/3rds of the town occupy themselves with art (and good enriching art by the way, art is essential), the “Smith” family decide for three generations to take on the sewer work and for that they’re paid more.
But by the time we get to grandson Smith, he had about 30% more savings than his baker friends and although everyone has a house, Smith is able to pay more for that house by the nice trees with a particularly nice view.
Etc. You get the idea. There is too much of human existence that still needs to be motivated by compensation. And as soon as you do that some people will think the sacrifice worth it in order to improve their lot and others won’t be so bothered.
If you took everything Mr Smith earned extra from spending all day in sewage and gave it to the bakers children instead so that there isn’t any kind of generational inequality. You don’t see how that’s fundamentally never going to work with humans? Maybe you’ll get one or two people who see the social need of cleaning the sewers. But the whole point of compensating some jobs more is that the needs of human society don’t neatly line up with what humans are inclined to do, so some sort of personal enrichment is needed to motivate the essential task of wading in shit all day rather than inhaling the amazing aroma of freshly baked bread.
And part of that compensation, what people value, is being able to give some of your sacrifice to your children.
(Although I make it clear at the top what I’m responding to let me also be clear that I in no way think the current exploitative model of capitalism seen in the West is the “best” or “inevitable”. No way, it’s awful. There are millions of ways it can be improved and the disadvantaged helped. But this idea of current human society being able to function with enforced equal outcomes is delusional)
Wealth accumulates sure, that’s why at a certain point taxes should put a brake on that and above an even higher point it should be predominantly taxed. Inheritance tax should allow for some generational transfer but capped at a sane point. And fuckery using foundations etc etc should result in all of it being forfeit.
Added to that is idea of Scandification, where Nordic nations consistently do better in almost every metric compared to other forms of governing, economic viability and systemic equality. All because their citizens fundamentally believe that caring for the whole is better than than the “feudal economic model, in which a handful of lords got very very rich while the vast majority of the populace scraped by” source .
How many people would even turn up to work if it made no material difference to their life?
Maybe not the same jobs, but most people would. Human beings are wired to want to feel productive.
I don’t think we should be abolishing money or anything, and different jobs should pay different wages. Still, I think all people should have their basic needs met.
I believe this is the main source of unfairness in my country. I have a good pay, but most of it goes for housing. So I live the same life as someone who works for a minimum wage if they inherited their home or can live with their parents.
Even though I had to work and invest way more to get to my salary.
But what is even worse is that in eyes of our government I am considered rich and I get no social benefits and I also pay way more taxes than those who are “poor”.
This tracks from my experience.
